Assignment July - 2016 & January - 2017 MCS-035 Accountancy and Financial Management

MCS-035

1.     From the following Trial Balance of Raghu Ram, prepare Trading and Profit & Loss Account for the year ended 31st December, 2015 and a Balance Sheet as on that date:-

Dr. Balances	Rs.	Cr. Balances	Rs.
Opening Stock	25,000	Sales	2,90,000
Purchases	75,000	Purchase Return	4,000
Sales Return	5,000	Discount	5,000
Carriage Inwards	2,000	Sundry Creditors	20,000
Carriage Outwards	1800	Bills Payable	2000
Wages	42,000	Capital	60,000
Salaries	27,500
Plant & Machinery	100,000
Furniture	5,000
Sundry Debtors	55,000
Bills Receivable	2,500
Cash in Hand	1,300
Travelling Expenses	4200
Lighting	2000
Rent and Taxes	7,200
General Expenses	9,000
Insurance	1,500
Drawings	15,000
	3,81,000		3,81,000

        Adjustments:-

        1.     Stock on 31^st December, 2015 was valued at Rs. 25,000 (Market Value Rs. 35,000).

        2.     Prepaid insurance amounted to Rs. 600.

        3.     Salaries outstanding for December, 2015 amounted to Rs. 3000.

        4.     Wages outstanding for December, 2015 amounted to Rs.4,000.

        5.     Provide depreciation on Plant and Machinery at 5% and on Furniture at 20%.

2.     Following are the balance sheets of a limited company as on 31st December, 2014 and 2015.

Liabilities	2014 Rs.	2015 Rs.	Assets	2014 Rs.	2015 Rs.
Share Capital Reserves B.&L A/c Bank Loan (Long-term) Creditors Bills Payable	64,000 13,000 8,600 25,000 38,000 8,000	84,000 15,500 8,800 --- 34,000 8,500	Goodwill Buildings Plant Stock Debtors Cash Bank	3,000 50,950 35,000 25,500 42,000 150 ---	2,250 48,000 43,000 18,800 36,200 450 2,100
	1,56,600	1,50,800		1,56,600	1,50,800

Taking into account the following additional information, you are re-required to prepare funds flow statement and statement of changes in working capital.

        (a)   Dividend paid was Rs.6,000/-

        (b)   Rs.3,600/- was written off as depreciation on plant and Rs.2,950/- on buildings.

        (c)   Profit on sale of plant was Rs.3,000/-

3.     “Return on Investment is a single comprehensive measure that contains everything happening within the organisation” Explain the statement and illustrate its computations with imaginary figures.

                (20 Marks)

4.     What are the basic components of capital budgeting analysis? Explain the difference between IRR and NPV Methods. (20 Marks)

5.     Efficient cash management will aim at maximising the availability of cash inflows by decentralising collections and decelerating cash outflows by centralising disbursements.” Discuss.

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